If you work in the world of audiovisual platforms, you should definitely take into account how to reduce churn rate to benefit the profitability of your project.
Once you have monitored your churn rate, the next step is to think about and implement strategies to reduce the churn rate of your business. Paying attention to this issue will help you improve the financial stability of your brand. At JUMP TV, a business data management platform designed specifically for video service players, we give you some important data to reduce churn rate.
What is the churn rate?
The term “Churn” can be translated as shake or move, hence the idea of churn. Translated to the audiovisual business market, Churn Rate is the rate of abandonment or cancellation that is registered in your user and viewer base.
The churn rate can be taken as a very useful metric to evaluate the success of a company. as the results of the churn rate have an impact on turnover.
The company should have the necessary resources to control the churn rate and monitor the abandonment rate, it is the best option to achieve a reduced churn rate.
What is the purpose of measuring the Churn Rate?
It serves to be aware of the permanence or not of users and viewers in the project, trying to improve the strategies used to achieve and maintain customer satisfaction.
Measuring the churn rate is useful to know the reasons that led to the cancellation, in order to carry out a more effective action plan and reverse the situation. The goal is to achieve long-term success.
How to calculate the Churn rate?
To calculate the churn rate, the following formula needs to be applied:
- Churn Rate: customers who canceled the service during the month/customers at the beginning of the month x 100.
For example, if your project starts the month with 100 viewers or users, and after 30 days it drops to 90, the calculation would be done as follows:
- Churn Rate= 10 (viewers who canceled) / 100 (users at the beginning of the month) x 100
- 10/100 x 100
- 0,1 x 100
- Churn Rate = 10 (Churn Rate would be 10%).
Taking into account the results of the Churn Rate analysis is important in order to develop strategies for customer retention, after-sales and pre-sales.
How to reduce the churn rate in your company?
In order to reduce churn rate in your project, some actions must be taken into account:
Know the reasons for cancellation.
A very common reason may be the lack of money to invest or a disagreement with respect to the product or service provided. Contacting the user after the cancellation can help.
Be able to recognize which users are most likely to abandon the project.
This will help you to know if the reasons are within your control, i.e. if they are reasons that you can reverse with an action. For example, if there were failures in customer service, you can take measures to improve.
Collect as much information about the user as possible.
If there are more requests for technical support, what they think about your brand or company in social networks, in the pre-sales process analyze if the customer needs more personalized attention, etc.
Having a Customer Success team.
In order to act quickly and efficiently, a Customer Success team will be able to anticipate the problems that users may have and provide them with solutions. For example, teaching them how to use the product or service properly to ensure a good experience and thus ensure that they remain loyal to the project.
Valuing the customer experience.
Focus marketing strategies on maintaining customer satisfaction.
Listen to the user.
The professional team can work on improving the customer experience not only in an automated way but focusing on the product or service to see it from the user’s eyes.
Attend to customer demands.
Another crucial point to reduce churn rate is to align expectations, to try to achieve a long-term relationship with users.
Pay attention to the suggestions received and take action.
For example, if there are repeated manifestations of problems that are reiterated over time, do not ignore them, analyze the cases and carry out an action plan to seek solutions. Solving problems is an investment, not an expense.
In the video player market, understanding the customer journey is key to attracting new ones, but retaining customers for as long as possible is even more important.
Machine Learning algorithms not only analyze the individual behavior of each user, but also predict their future behavior, so you can take action before they leave and impact them with hyper-personalized content, marketing campaigns and promotions that engage them with your service and stay on for longer periods of time.
If you want to learn how to avoid user churn, discover how our service works to understand why users leave the video service and reduce churn. Skyrocket your video business with Jump Data-Driven!